GDX, This Most-Hated Stock Could Return You 140% in Just a Few Months / Commodities / Gold and Silver Stocks 2018

Opportunitieslike this are rare. I study markets for a living and I see one setup like it ayear, at the most.

But will you listen to me? Will you buy the stock Irecommend in this article?

I hope so… because there’s a realistic shot to makeroughly 140% in just a few months.

But there’s a catch.

You’ll have to buy the single most hated asset class on the planet today.

The Asset Classthat Investors Gave Up On

It’s gold.

Since 2011 gold has plunged 35%. Even worse, goldstocks have cratered 70% in the past seven years.

Investors have completely given up on gold and goldminers. The VanEck Gold Miners ETF (GDX), which tracks theperformance of gold stocks, closed lower for six weeks in a row.

That almost never happens. If fact, since thecreation of GDX in 2006, it has only happened twice.

The last time was in late 2015. (I’ve marked it inthe chart below.)



Do you see what happened next? GDX bounced aroundfor a few months before soaring 140% gains in eight months.

Just Like in 2015, GFX Has Entered a State ofExhaustion

Finance nerds use the word exhaustion todescribe an investment that’s been subject to relentless selling pressure.

There’s always a point where all investorsinterested in selling a stock have sold it. When this happens, we say thesupply of sellers has been “exhausted.”

Because there’s no one left to sell, exhaustionoften signals that a stock has put in a bottom and is ready to march higher.

GDX has entered a state of exhaustion for the firsttime since 2015. And after months of sharp drops, it’s finally perking up.

It recently jumped 6% in a single week… one of itsbest stretches since its 140% surge in 2016.

Gold Has Never Been Hated as Much as It Is Today

Six straight weeks of losses in GDX is just onedata point that shows investors want nothing to do with gold stocks.

Last month, professional traders were “short” goldmore than any time since 2001!

2001 was the beginning of the last great gold bullmarket. In a decade, gold rallied 630%.

The 2001 bottom also prompted a 1,350% surge ingold stocks.

Here’s another telling statistic.

This year, investors have yanked $3.5 billion fromgold-related ETFs. That’s the highest level of withdrawals in five years.

To get an insider’s look at the market, I called upAdrian Day of Adrian Day Asset Management.

Adrian is a professional investor who’s been investingin the resource sector for over 25 years. Here what he told me:

“Gold stocks are more or less at the samelevel they were in 2001 when gold was a fifth the price it is today. Very fewfunds hold any gold stocks today, whereas 15, 20, 25 years ago, a lot of themdid. But the stocks are now responding to good news—a very positive sign thatthe market is turning.”

It’s no exaggeration to say gold stocks have never been as hated as theyare today.

This extreme hatred tells me buying gold miners nowis a smart move.

It’s never easy to go against the crowd and buy ahated asset. You’ll probably feel uneasy hitting the “buy” button.

But buying hated stocks is one of the lowest risk ways to make big profitsin markets.

In fact, the last “hated” stock I recommended toyou was 3D printing company Stratasys. It has leapt 25% in the last week thanks to better than expectedearnings.

Now, gold may lack the excitement of the disruptivetechnologies I often writeyou about.

I understand. Self-driving cars, DNA mapping, and the coming superfast 5G cell phone network are much“sexier” than gold mining stocks.

But please, don’t let that stop you from takingthis opportunity seriously.

This Stock Could Double Your Money in the Next FewMonths

Gold miners are perhaps the most explosive group ofstocks on the planet. Gold stocks have exploded for triple- or quadruple-digitgains seven times in the past 48 years.

Buying gold stocks at the correct time is one ofthe few legitimate strategies for earning big returns quickly in the stockmarket.

It’s also a backdoor way to profit from one of themost insidious disruptions to your finances: the slow death of the US dollar.

I won’t get into the whole case for gold here. Ifyou’ve paid a medical or tuition bill recently, you know a dollar doesn’t gofar these days.

And if you’re familiar with how our financialsystem works, you know our money isn’t tied to anything of real value anymore.

By the US government’s own calculations, a dollaris worth 86% less than it was 50 years ago.

Meanwhile, gold has held its value for thousands ofyears.

Gold miners are a supercharged version of gold.Even a modest move in gold can push gold stocks much higher. As I mentionedearlier, when gold jumped 30% in early 2016, GDX shot up 140%.

I’m buying GDX here. My research shows we coulddouble our money or better in the next few months.

By Stephen McBride

http://www.riskhedge.com

© 2018 Copyright Stephen McBride- All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

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